Edward Fagan, the first lawyer to sue Swiss banks for hoarding the money of Holocaust victims and who championed survivors’ rights in insurance and art cases, has been charged by the New Jersey Office of Attorney Ethics with looting more than $400,000 from the trust accounts of two survivors he represented.

Disciplinary action ranges from an admonition to disbarment.

“The knowing misappropriation [of funds] is a disbarable offense,” said John McGill III, the deputy ethics counsel who is overseeing the case.

McGill said state rules allow his office to refer cases to law enforcement “if a crime has been committed,” and that it would not be necessary to wait until the complaint process is completed. It usually takes about a year. McGill said no referral has been made “at this point.”

Fagan said he had not seen the complaint. “As soon as I see the information I will retain counsel and respond,” he said.

When he was interviewed by McGill’s office last year, Fagan was working from an office in Short Hills, N.J. A secretary at that office said Tuesday that Fagan has not worked there for six months.

McGill’s office sent a certified letter to the Short Hills office, but it was returned unopened this week. McGill said the post office provided an address for Fagan in Morris Plains, N.J., and that he has sent another certified letter, as well as a regular letter, to the attorney there. McGill said he will give Fagan until Feb. 4 to respond.

If Fagan has not responded by that date, McGill said he would send another letter giving Fagan five days to either respond or be found in default.

If Fagan contests the charges, a three-member panel of the Ethics Committee will hold a hearing. Its recommendation would be offered to the nine-member Disciplinary Review Board, whose decision would then be submitted to the New Jersey Supreme Court for final action.

The allegations against Fagan include that he deliberately misled the New York State attorney disciplinary committee when it questioned him about charges brought by a former client and survivor, Gizella Weisshaus. She claimed that Fagan had stolen funds from an escrow account established in the name of her deceased cousin, Jack Oestreicher.

Weisshaus said she entrusted the funds to Fagan because the attorney told her that he could get a higher interest rate on the $82,583 in the account.

The New Jersey complaint alleges that Fagan withdrew money from that account for matters “unrelated to the Oestreicher client matter. At the time [Fagan] invaded the Oestreicher estate funds … he knew he lacked the authority to do so.”

When New York authorities questioned Fagan in June 1998 about the Oestreicher account, the complaints said Fagan produced a bank statement from another account “as proof that the integrity of the estate funds had been maintained.”

In fact, the complaint alleges, Fagan showed state investigators a bank statement from another trust account he controlled. That account was in the name of Estelle Sapir, a survivor whose complaints against Swiss banks led them to settle with her for $500,000.

“By providing a copy of his Summit trust account bank statement … [Fagan] attempted to deceive the New York disciplinary authorities into believing that he had maintained the integrity of the Oestreicher estate funds, knowing that the only funds in that account at the time were those for the Sapir matter,” according to the complaint.

It is alleged that Fagan then used Sapir’s money “without authority” to pay a court judgment against the Oestreicher estate.

“From May 18, 1998, the date the Sapir settlement funds were deposited into [Fagan’s] Summit trust account, to April 15, 1999, the date of Sapir’s death, [Fagan] made 37 disbursements totaling $302,750 by checks payable to cash and wire transfers to his Summit business account from Sapir’s funds,” the complaint said. “[Fagan] made the disbursements … knowing that he lacked the authority to do so.”

The complaint alleges that other than $1,500 Fagan gave Sapir in June 1998 and $7,300 he allocated to cover Sapir’s funeral expenses, Sapir systematically looted her account. In the five months after her death, it is alleged that Fagan withdrew $124,750 from Sapir’s account that was paid either in cash or to his own business account.”

It is further alleged that in August 1999, in order to cover the disbursement of $190,000 to Sapir’s relatives when he only had $3,330.94 in the Sapir account, Fagan borrowed $225,000 from a former client and friend.

A spokeswoman for the Sapir family said she hopes Fagan “comes forward and does the right thing for everyone if there is money owed to any of the family. This issue brought up such emotional distress, and this is only adding to it.”

Weisshaus said Fagan never “had the right to switch my money.” She said she initially believed in him, even working in his office for eight months without pay because “I thought he was working for us.”

McGill said any action taken against Fagan would be forwarded to New York State authorities, whose First Department Departmental Disciplinary Committee would then be expected to submit the decision to the Appellate Division for its consideration.